Stock market is getting uglier and uglier

Please don't feel too panic when the market is getting uglier and uglier. Here are some thoughts that I hope to share with you:

• The worst has not yet come. Inflation, asset bubble explosion, high oil and food prices, social unrest, currency devaluation and manipulations, ...these are perhaps the symptoms emerging from the 1st half of 2008.
• Think about what will happen when the ECB is forced to raise interest rate this week.
• Think about what will happen when our People's Bank of China is forced to further tighten monetary policy by raising reserve requirements and interest rate.
• Think about what will happen when the US slowdown weakens exports from emerging markets.
• Think about how low stocks must go down from their lows in the first half of 2008.
• Think about what will happen when avian flu attacks the world again.

So many many negatives! But let's face it: we have gone through these terrible periods. I mean people who were hit by the Asian financial crisis in 1997-98. So I believe Asian markets may have tougher strength to fight against the emerging recession and crash. But I must stress that I don't mean the stock markets in Shanghai and Shenzhen. Why? The unfortunate investors there don't have the experience of the Asian financial crisis. So are the unfortunate investors and house owners in US.

Should we sell off everything and take a good long break? Well, this depends on your personal circumstances. If you can hold on for at least the next 6 months, I think you should not sell. If you have enough ammunition ready, you may set the level when you should buy low. But if you are scared or just can't make it, you should have retreated by now. Yes, you should have sold everything when the subprime crisis occurred last year.

But very little appears to be worth buying. Financials still have a long way to go down. We are all caught in the web now since they turn out to be worse than we thought. Commodities including oil have reached record high prices. Would you dare to tread further now? We can't ignore the downside risks when recession hits the global economy including China and India. What else? Technology? Healthcare? Transport, Industrials, Auto..Consumer Stap...

The Dow is down by almost 120 points at this moment. I hope we can make it through the night.